The Union Cabinet of India has given the green light to a 2% hike in the dearness allowance (DA) for central government employees, bringing some relief to millions facing rising inflation. This increase raises the DA from 58% to an even 60% of basic pay, according to official statements.
Effective from January 1, 2026, the revised allowance will mean that employees can expect arrears for January, February, and March when they receive their salaries in April. It’s a move designed to support approximately 49 lakh central government workers and more than 70 lakh pensioners.
This announcement comes at a time when employee unions have been advocating strongly for the formation of the 8th Pay Commission, seeking further improvements in pay structures. The pressure from these unions reflects ongoing concerns over cost-of-living increases.